Changes To The Loan Syndications And Trading Association Documentation

On Friday, June 28, 2013, the Loan Syndications and Trading Association (the "LSTA") will publish new versions of the forms of Par Trade Confirmation, Distressed Trade Confirmation, Purchase and Sale Agreement¹ and Collateral Annex. The primary changes to the trading documentation will establish, by default, that a buyer post collateral when participating in unfunded revolvers and provide new formulas for calculating the Collateral Shortfall in the Collateral Annex. These changes reflect an effort by market participants to standardize the terms in order to shorten the negotiation period and more accurately reflect current market practices.

Par and Distressed Trade Confirmations

The new form of Par and Distressed Trade Confirmations and accompanying Standard Terms and Conditions will require that a buyer post collateral when participating in unfunded revolvers unless the parties agree otherwise. There will be a check the box option in the form so that the parties